How To Own More Properties Without the Bank saying No

Want To Own More Properties Without the Bank saying No?

For many investors, the ultimate dream is to build passive income high enough to say good bye to your day job. This is what we learned through Robert Kiyosaki’s four quadrant where you move from the initial quadrant of employee to fourth quadrant as investor. This is where your money is working for you and you not working for your money.

How To Buy More Than One Investment Property

This all sounds great investing into Real estate, but banks has a way of capping this dream of yours. As we know with our current banking rules, to get the lowest mortgage rate, an investor has to provide a minimum of 20% down plus closing cost for investment properties. Unless the investor has a minimum of 3 income properties, the banks will only approve the loan based on Rental Offset where they will take only a portion of the rental income and all of your debts including your personal mortgage. Your total amount of debt cannot exceed 40% of your gross income or slightly higher depending on the lender. Unless your income is high enough to offset the difference, a glass ceiling is put in place preventing you from buying more rentals and you achieving your dream.

If you own more than 3 income properties, you have the opportunity to qualify under the Debt Coverage Ratio (DCR) financing with several lenders without door limits. The bank would like to determine your ability to generate enough income in your operation to cover the expenses of the mortgage.

Debt Coverage Ratio = Net Operation Income / Debt Service = DCR

(You can download a copy of two different major bank lenders DCR spreadsheet from the link)

How To Raise That Glass Ceiling? It doesn’t matter if you are buying long term buy and hold or rent to own deals, the lenders will only take a portion of the income and offset it with debt. So let’s take for simple example of a home costing $200,000, with 20% down based on 2.79% rate and 25 year amortization, the cost of borrowing is $740/month and taxes are at $200 a month. Vacancy is set at 4%

Buy and Hold- Rent is $1,200 a month, utilities covered by tenant.

DCR (B&H) = $1,200 (.96 vacancy) / 740 + 200 = 1.23

Rent To Own – Rent is set at $1,600 a month, utilities covered.

DCR (RTO) = $1,600 (.96 vacancy) / 740 +200 = 1.63

The difference is dramatic, it is the same house purchased at the same price. Both qualify under the same rental program except the RTO investor is qualifying with more income. This opens up the glass ceiling and raises it to you as an investor can push for more doors and make that passive income stream a reality. Plus the RTO investor has an occupant with more skin in the game than a rental tenant with first and last. Which investor would you like to be?

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Mallorytown is a community ideally placed on the 401 corridor between Gananoque and Brockville.

The Kingston Real estate board, which includes Mallorytown, realized on a year-to-date basis, home sales totalling 3,414 units over the first 10 months of the year. This was up 6.8% from 2016 and was the highest level on record for the period.

“Home sales were still running at historically strong levels in October 2017 – just 17 sales below the all-time October record set 14 years ago,” said Colleen Emmerson, President of the Kingston and Area Real Estate Association. “With demand still strong and supply continuing to move lower, the market is currently about as tight as it has ever been.”

The average price for homes sold through the Association’s MLS® System in October 2017 was $323,566, rising 6.5% from October 2016.

The more comprehensive year-to-date average price was $328,745, up 7.6% from the first 10 months of 2016.

Average selling price in this marketplace is $251,000 during the past 30 days. Selling prices continue to grow at an incredible rate – sitting at 28.8% over the last 90 days

Moneysense.ca has added Bracebridge to their list of the best places to live in Canada for the first time this year. Bracebridge came in 18th – but rated the Top 10 for low unemployment numbers, access to health care, and the low crime rate. Among other considerations were high incomes, affordable housing and low taxes.

This opportunity is located in Welland – a community with a population of 48,000 that lies in the southeastern corner of the province between the Great Lakes of Erie and Ontario in the Niagara Peninsula fruitbelt. The climate is moderated by the Great Lakes, being mild without extremes in temperature or precipitation throughout the year. This picturesque “city on the canal” is located in the heart of Ontario’s Niagara Region, approximately twenty minutes from Niagara Falls.

Welland’s volume of sales decreased 6% over last year – however, their average sale price went up 24.6%

The Welland area continued to have healthy market activity with an average residential sale price of $387,001 – 9.97% higher than last October. The average days on market modestly increased from 34 to 39 in the freehold market.

This property is beautifully maintained, and is situated in one of southern Ontario’s most desirable locales.

The London and St. Thomas Association of REALTORS® (LSTAR) announced 757 homes exchanged hands last month, slightly down 10.2% from the same time a year ago. Year-to-date sales are up 10.6%, with a total of 10,111 homes sold, marking the second consecutive year residential sales have surpassed 10,000 across the region.

In October, the average sales price across London and St. Thomas was $325,331 up 14.2% from the same time a year ago. The average year-to-date sales price was $330,497 up 18.3% from October 2016.

According to Statistics Canada, the Regional Municipality of Sudbury has the most happy people in the country. About 45 per cent of Sudbury’s residents rated their life satisfaction as a nine or a 10 on a 2015 survey! Lively, a beautiful community within greater Sudbury is located just west of the city limits.

The year-to-date average price was $264,055 in September, rising 3.4% from the first seven months of 2017.

The Town of Ajax, which is 45 minutes east of downtown Toronto, Canada’s largest city. With a growing community population of 90,000, Ajax boasts some of Durham Region’s finest recreational facilities, pristine lakefront parks, and trails to our shopping and entertainment areas. There is something for everyone.

Located east of Toronto, the Durham region begins approximately 50 km east of Toronto’s city center. It encompasses Pickering and Oshawa to the east, and is bordered by Bowmanville, Lake Ontario, and Brooklyn and Port Perry to the north, with Courtice representing the most central area.

The area is ideally positioned for commuters looking to make the daily trip to Toronto for work. The northern areas of this region are plentifully populated with walking and hiking trails – not to mention a vast assortment of outdoor activities to occupy oneself during personal time with family and friends.

Durham Region Association of REALTORS® (DRAR) reported 835 residential transactions in September 2017, and an increase in the number of new listings in Durham (1,914), compared to the 1,556 new listings reported in September 2016.
The average housing price for September in Durham Region was $578,666, a slight decrease over the previous month, however an increase of 4.25% over the same period last year.

Homes listed on the market continue to sell in an average of 23 days.
This is an opportunity not to miss!

This estate property, located conveniently near highway access to Toronto, is a beautiful, well maintained property that shows unmistakable evidence of pride of ownership. With average income in this community sitting well above the national average, this community of 8,000 attracts homeowners seeking a more spacious environment than the typical GTA estate property. Homes throughout Mono are consistently well cared for and maintained.

This is a rescue refinance opportunity with a realistic RTO plan, great returns, bundled into a short-term program.

Market statistics for Mono over the past month indicate a Median List Price of $1.1M, with a Median Selling Price of $1.1M – yielding a Listing-to-Selling Ratio of 99.15%. The Price Change over the year is +16.8%, with the Average Days on Market sitting at 51.

According to Statistics Canada, the Regional Municipality of Sudbury has the most happy people in the country. About 45 per cent of Sudbury’s residents rated their life satisfaction as a nine or a 10 on a 2015 survey! Lively, a beautiful community within greater Sudbury is located just west of the city limits.

The less volatile year-to-date average price was $264,055 in July, rising 3.4% from the first seven months of 2016.

Brampton is an ideally placed community for the vast workforce in downtown Toronto. Access is plentiful from Brampton, with Metrolinx running GO trains and buses on a regular intervals, and multiple highway options – including 401, 407, and 410 access for the trip to and from the workplace. This has made Brampton a highly desirable location for southern Ontario families,

Brampton is also witnessing a major boom in economic activity with many multinationals including Amazon, Canon, GAP, and BestBuy choosing the city as their major warehouse destination.

Current Brampton MLS stats indicate an average house price of $666,153 and 1,347 new listings in the last 28 days. As of today, Brampton housing data shows median days on market for a home is 24 days, as of Oct 28th 2017. This represents an 8.9% increase since September 2016

This Ridgeway opportunity has been completely renovated within the last 4 years. An open concept, 2 bedroom bungalow, with high vaulted ceilings and a breakfast bar are some examples of the interior work completed – a beautiful home!

Ridgeway and Fort Erie is considered a Gateway Economic Corridor within Niagara due to its close proximity to the United States border. With 23 new major investors and 15 major industrial businesses expanding their operations within the area, and it has become the fastest growing community in Niagara. Green space is plentiful and residents enjoy boating, fishing, swimming, hiking and more! The area boasts some of the most beautiful beaches in Ontario as well as plenty of waterfront access.

The area continued to have healthy market activity with an average residential sale price of $387,001 – 9.97% higher than last October. The average days on market modestly increased from 34 to 39 in the freehold market.

The City of Timmins offers a culturally diverse atmosphere with a variety of ethnic restaurants, museums, and cultural organizations offering the community a multicultural experience with a Northern perspective. A vigorous job market, with typical salaries equivalent to those found in Southern Ontario, has made Timmins an attractive option offers the urban lifestyle of major Canadian metropolitan communities but at half the cost.

The median sale price for single detached homes was up 10% on a year-over-year basis to $165,000 in the third quarter of 2017; this was the highest median price on record.

year-to-date average price was $164,052, up 5.7% from the first ten months of 2016. In the $200-250,000K price range, houses sold increased by 6.3% over this quarter compared to 2016.

Markham is a thriving multicultural community that boasts a variety of amenities from universities, manufacturing, industry – and is often referred to as Canada’s “High Tech Capital.” Once upon a time considered to be on the outskirts of the GTA, it is now firmly nestled within the heart of the broad community – with residents and businesses easily accessing transportation gateways and airports. It is a well desired location for home ownership.

November CREA statistics indicate the housing marketplace in Markham – despite Provincial ceiling measures – continues to be strong. Sales for the last quarter are up 10.9% compared to the same quarter 2016.

This opportunity is in what “The Real Estate Investment Network” coined as one of the top places to invest in the entire province – Barrie. Barrie has a growth strategy to implement by 2031 that will see population rise to 210,000 and jobs to over 100,000. One of the key ingredients to the growth has been the addition of the GO Train linking Barrie with the GTA. This Property is located within minutes from the South Barrie GO Station.

The year-to-date average price for all homes sold via the association’s MLS® System was $532,020, up 23.1% from 2016.

The year-to-date average price figure for homes sold within the City of Barrie was $507,484. This was an increase of 24.8% compared to the average selling price in 2016.

October 1 to October 28 2017 has 192 sales, with an average 29 days on the market. This market continues to be strong with buyers due to its proximity to both Toronto and Ontario’s prime Muskoka cottage country.

Commuters know Belleville as a great spot to stop enroute between Toronto and Ottawa. The city is in a prime position along the 401 corridor, but it’s so much more than a stop-through town. A thriving downtown, established businesses, and close proximity to CFB Trenton make this an ideal community to live in.

Residential sales in units, year to date for 2017, is 4.0% above 2016. Inventory is low making properties a hot commodity in the lower income price range.

Smiths Falls, located halfway between Kingston and Ottawa, is situated on the Rideau Canal. The waterway passes through this picturesque southeastern Ontario town, with four separate locks in three locations adding interest and beauty to the heart of the community. It is less than an hour to either Kingston or Ottawa.

Colleen Emmerson, President of the Kingston and Area Real Estate Association, is quoted commenting on the area market October 2017 saying “With demand still strong and supply continuing to move lower, the market is currently about as tight as it has ever been.”

The average price for homes sold through the Association’s MLS® System in October 2017 was $323,566, rising 6.5% from October 2016.

Sales of all types of properties numbered 354 units in October, rising 14.6% on a year-over-year basis. The total value of all property sales rose 14.6% from a year earlier to $105.8 million in October.

Brampton is an ideally placed community for the vast workforce in downtown Toronto. Access is plentiful from Brampton, with Metrolinx running both GO trains and buses on a regular intervals, and multiple highway options, including 401, 407, and 410 access for the trip to and from the workplace. This has made Brampton a highly desirable location for southern Ontario families,

Brampton is also witnessing a major boom in economic activity with many multinationals including Amazon, Canon, GAP, and BestBuy choosing the city as their major warehouse destination. These corporate powerhouses continue to add to the area’s market interest and value.

Current Brampton MLS stats indicate an average house price of $666,153 and 1,347 new listings in the last 28 days. As of today, Brampton housing data shows median days on market for a home is 24 days, as of Oct 28th 2017. This represents an 8.9% increase since September 2016.

Binbrook is a quiet community nestled in the Hamilton suburbs, tucked away from the urban area, that has become a popular place to live. It is conveniently located minutes from Hwy 403and the QEW, giving residents direct access to Bulington, Oakville, Mississauga, Toronto, and the Niagara region.

Current (October 2017) Binbrook MLS stats indicate an average house price of $528,178 and 33 new listings in the last 56 days. As of today, Binbrook housing data shows median days on market for a home is 33 days.

The last two months saw 33 new listings in Binbrook, 22 sales (at an average of 98% list price), taking an average of 33 days to sell.

October 2016 to October 2017 shows an average price increase of 11.4% – awesome annual production –within the Hamilton area.

Located in Southwestern Ontario, Collingwood is located in one of the most beautifully scenic areas of the province. Beaver River flows nearby into Nottawasaga Bay, with the Niagara Escarpment dominating the landscape, providing a beautiful setting to both live and play. Recent development projects are marketing directly to buyers working in the GTA.

There were a total of 47 New Listings in the month of September for the Collingwood/Blue Mountain area.

The Average List Price was $632,038, with a range of $229,900 – $1,999,999.

The Southern Georgian Bay Association of Realtors noted in their second quarter report that the Collingwood area posted all-time record quarterly volume of $109,811,406 – up 24% from the prior mark set in Q2-2016. The report also notes that YTD volume of $164,611,863 is up 26% from 2016’s record, while unit sales of 349 are down 4% from this time last year.

Second quarter 2017 volume of $101,703,537 is up 16% from 2016, units of 188 are down 8%. Average sale price of $540,976 is up 26%, while average days-on-market of 29 is down 7 days.

Although unit sales are down slightly and listings up slightly from 2016’s totals, 2017’s record dollar sales, high sales/listings ratio, shorter sale times and huge average price jump all indicate that the demand for listings still greatly exceeds the supply.

Guelph consistently ranks in the top 10 safest cities in Canada to live. Thanks to the low crime rate, it’s been ranked by ReadersDigest.ca as the best city in Canada to raise a family. Despite having a population of about 150,000 in the metropolitan area, Guelph maintains its small-town vibe with a strong sense of community.

“While home sales were still running well below last year’s record levels in September, they remained in a better position compared to their July low,” said Kim Hannah, President of the Guelph and District Association of REALTORS®. “New supply was also up in September, which along with a bit of a rebound in sales could be taken as a sign that confidence is beginning to return to the market.”

The MLS® Home Price Index (HPI), tracks price trends far more accurately than is possible using average or median price measures. The overall MLS® HPI for Guelph and District rose 17.3% in September 2017 compared to the same month in 2016. This was a slower rate of growth compared to the previous seven months – but still remarkably strong performance from an investment perspective.

Guelph realized 149 sales in September down slightly from September 2016. However, the first 3 weeks of September were very slow while most people got their kids settled in for school. We saw the market start to pick up over the last week of September with a large increase in the number of offers and conditional sales which should show in our October stats. The average selling price in September was $467,611. Days on market remained flat at 26 days but houses sold for closer to list price in September with the average house selling for 99.2% of asking. Single-family home prices were also up 17.3%. By comparison, townhouse prices rose 14.1% from last September and apartment unit prices climbed 22.6% compared to a year earlier. Average

Typically, this market typically follows Toronto’s trends by about 4-6 weeks, and as noted above, we expect this marketplace to indicate housing prices rising more steadily moving forward.

Tobermory is located at the top of the Bruce Peninsula – just outside of Owen Sound. Tobermory offers fresh, clean air, gorgeous scenery, tranquil waters, and is regularly described as having the most spectacular sky’s in southern Ontario. Tobermory is almost surrounded by water – Lake Huron on one side and Georgian Bay on the other. It is a naturalist haven, having 2 national parks – Fathom Five National Marine Park and the Bruce Peninsula National Park – close by.

The average price of homes sold in September 2017 was $284,249, up 9.6% year-over-year.

The year-to-date average price to September 2017 was $290,293, rising 12.2% from the first three quarters of 2016.

Cambridge Market Overview

Cambridge has become a charming and scenic community that started as three smaller communities – Galt, Hespeler, and Preston. The Speed and Grande Rivers intersect in Town, with the Grande meandering through the whole city. Because of this, there are plenty of trails and parks integrated within the community. It is situated within the Waterloo Region – attractively located within reach of two Universities and two Hospitals. Also, it is located on the popular Hwy 401 corridor accessing the Toronto Region directly.

Canada’s national median home listing price this month (September 2017) is $290,900, which places Cambridge is in the top 20% for Canada.

On a year-to-date basis, home sales totaled 1,786 units over the first eight months of the year. This was still up 2.7% from the same period in 2016.

“Home sales in the region actually improved a little in August compared to July, but the bigger picture is that activity is now back running at more or less average levels,” said Jim Robinson, President of the Cambridge Association of REALTORS®. “On the supply side, new listings have come down in line with sales in recent months, which is keeping inventories near all-time lows.”

The average price for homes sold in August 2017 was $434,471, up 9.6% from August 2016, with year-to-date average pricing of $466,903 – a whopping 27% rise from the first eight months of 2016!

In Cambridge, housing stock has decreased over the last three months, which would tend to mean that home buyers are snapping up properties faster than they come on the market.